Modi, his uncle Mehul Choksi and firms controlled by them, according to investigative agencies, colluded with certain PNB staffers to issue fraudulent LoU to overseas branches of Indian banks.

MUMBAI: A significant portion of the funds raised fraudulently by Nirav Modi group from Punjab National Bank (PNB), through guarantees issued by it to overseas branches of Indian banks, has been used for buying immoveable properties abroad, the Enforcement Directorate (ED) believes.

People who have been briefed on the occasion said that this would probably make it easier for the investigating agency to recover suspected proceeds of crime from countries where Modi has business interest in. There are about 13 such countries identified by the ED, whose competent court has issued letters rogatory (LR) to counterparts in these jurisdictions to aid the agency in its probe.

Apart from investing the fraudulently acquired monies in properties, part of it was used by Modi’s firms to settle their debts to overseas lenders.

“We have reasons to believe that Modi’s firms settled loans raised from overseas creditors through letters of undertaking issued by PNB,” said one of the persons.

The thirteen locations to which LRs have been issued include US, UK, Hong Kong, UAE, Singapore, South Africa, Malaysia, Armenia, France, China, Japan, Russia and Belgium.

Modi, his uncle Mehul Choksi and firms controlled by them, according to investigative agencies, colluded with certain PNB staffers to issue fraudulent letters of undertaking (LoU) to overseas branches of Indian banks to ostensibly pay their suppliers for pearls and rough diamonds.

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